January 23, 2023
Craig Wright, the claimant in these libel proceedings, claimed to be Satoshi Nakamoto, the inventor of Bitcoin. The defendant, Peter McCormack, tweeted and said in a recorded discussion that Dr Wright was not Satoshi and that his claims to be Satoshi were fraudulent. Dr Wright issued proceedings for libel against Mr McCormack.
At trial, Dr Wright established that some of Mr McCormack’s publications were defamatory and caused serious harm to his reputation at the time they were made. Dr Wright was not, however, awarded substantial damages for the libel and was only awarded nominal damages of £1 because he had advanced a deliberately false case until shortly before trial.
The truth as to Dr Wright’s identity was not something the court had to consider in this case because Mr McCormack withdrew his defence of truth, saying that the cost of a trial on that issue was prohibitive.
The draft judgment was issued to the parties on 26 July 2022 under embargo. That evening, Dr Wright posted three messages on the “#bitcoin-general” channel of the MetaNet workspace of the Slack messaging platform, as follows:
- “If a person would spend 4 million to receive a dollar plus and 2 million costs… So the other side is bankrupt… What would you think? (edited)”;
- “Ie. The only thing that matters is crushing other side”; and
- “Well. I would spend 4 million to make an enemy pay 1”.
Breach of the embargo
Mr Justice Chamberlain found that: (i) Dr Wright’s own costs estimate incurred to trial was £4 million and that anyone with an interest in the litigation was likely to know that; (ii) the case had attracted considerable publicity among those with an interest in cryptocurrency; and (iii) the 290 members of the “#bitcoin-general” channel all had an interest in cryptocurrency and anyone with even a passing knowledge of how High Court litigation in England works knows that, usually, the parties to a judgment are sent an embargoed copy of the judgment in advance of hand-down.
Taking these findings into account, Chamberlain J could not accept, without further investigation, Dr Wright’s explanation that the purpose of his posts on 26 July 2022 (hours after being informed of the substance of the judgment), was “not to give any indication as to the outcome set out in the Draft Judgment”, but merely to “encourage debate”. In Chamberlain J’s view, there was a real prospect that a court might find that, by posting those messages, Dr Wright was disclosing, and intending to disclose, the substance of the judgment contrary to the clear terms of the embargo, which had been explained to him.
Dr Wright had also replied to an email from his solicitors, which had a summary of the draft judgment attached, copying in five other people who were not entitled to know about the judgment. Dr Wright said that he did not realise that the summary of the judgment was attached at the bottom of the email chain. However, in Chamberlain J’s view, these emails appeared to be a further breach of the embargo by Dr Wright, which might also amount to a contempt of court.
Accordingly, pursuant to CPR 81.6(1), Chamberlain J issued a summons requiring Dr Wright to attend court for directions to be given for the further conduct of the contempt proceedings before another judge nominated by the Judge in Charge of the Media and Communications List.
Injunctive relief and permission to appeal
Back in November 2020, Mr McCormack had offered an undertaking to the court not to repeat the words complained of or the same or similar words, subject to two caveats concerning other judicial decisions from various jurisdictions which also stated that Dr Wright had committed fraud and presented false cases. However, the undertaking was never accepted by Dr Wright and was never recorded in a court order.
Dr Wright now asked the court for injunctive relief preventing Mr McCormack from repeating the defamatory statements, but allowing him to refer to any report or judicial finding in relation to Dr Wright. It would be up to Dr Wright to apply for the injunction to be discharged if it was later established that Dr Wright was not Satoshi.
Chamberlain J declined to grant such an injunction because:
- an injunction is an equitable remedy and is not available as of right; Dr Wright’s dishonest conduct meant that he could not expect the court to reward him with an injunction;
- it would not be right to restrain Mr McCormack from reporting the terms of Chamberlain J’s judgment;
- it was not desirable for the court to grant injunctive relief which might have to be varied or refined on a rolling basis as new judgments in proceedings ongoing in various jurisdictions were handed down, and there was no good reason why the onus should be on Mr McCormack to begin further potentially costly proceedings to have the injunction discharged;
- the judgment already stated that Dr Wright was entitled to relief because of the libel and that Mr McCormack did not establish the truth of the libel; and
- injunctive relief was not required to impress on Mr McCormack the importance of caution in making public statements about Dr Wright and Bitcoin.
Finally, Chamberlain J refused Dr Wright permission to appeal the finding that he was only entitled to nominal damages. (Craig Wright v Peter McCormack  EWHC 3343 (KB) (21 December 2022) — to read the judgment in full, click here).